MONEY psychology of money

5 Ways to Reduce Your Financial Anxiety

Cutting down on discretionary spending and paying down debt will help reduce your financial anxiety. photo: shutterstock

Tired of feeling anxious about your family’s financial future? To reduce this lingering economic insecurity, try these strategies.

Create a plan. Fueling our anxiety about money is the feeling of being out of control — that economic events you have no hand in will hurt your prospects. Developing a financial plan with specific goals and targets helps you feel as if the control is back in your hands.

Need proof? Gallup reports that 80% of nonretirees and 88% of retirees with such plans said having a plan boosted their confidence that they could achieve their goals. And a Transamerica survey shows that workers with a written plan are 47% more likely to say that they’ll retire with a comfortable lifestyle than those without one.

Break off bite-size chunks. Lofty long-term goals like building a seven-figure retirement nest egg or saving enough to pay for your kid’s BA can feel impossible to achieve. So instead of focusing on big end numbers, set your sights on more manageable interim targets.

Related: What’s your money state of mind?

“Create small steps, each with its own deadline and reward,” says Harvard behavioral economics professor Brigitte Madrian. “The more small things you knock off your list, the less anxious you’ll feel about bigger goals.”

Accentuate the positive. “Our brains tend to focus on the negative, so it’s a struggle to see what’s going right,” says Rick Kahler, president of the Financial Therapy Association.

Help yourself by taking inventory of what’s going well for you moneywise — maybe you’ve upped your 401(k) contributions, your home’s value has jumped, or you’re saving money by brown-bagging it at work. Use the list to buoy your spirits when setbacks occur.

Related: How we feel about our finances

Plump your cushion. The single best move you can make to feel better about your finances: Build up your emergency fund.

A University of Georgia study has found that having adequate reserves is a better predictor of financial satisfaction than other moves, such as paying off credit card debt. “It’s like having extra insurance,” notes Terrance Odean, a finance professor at the University of California at Berkeley.

Don’t get too relaxed. The recession made us realize how vulnerable we are, Madrian says. And that awareness led many to cut back on discretionary spending, pay down debt, and save more.

“These habits are good,” says Odean. “If anxiety motivates people to make these changes and can motivate them to save even more, you don’t necessarily want to relieve people of all of it.”

TIME Research

Science Says Stress Is Contagious

A new study from the Max Planck Institute for Cognitive and Brain Sciences and the Technische Universität Dresden finds that stress can be super contagious: not only can being around a stressed person physically stress you out, but so can watching certain videos

See someone yawn on the subway, and you know there’s a pretty high probability that you’re going to be yawning. But new research says that there’s another contagion out there that you can catch just through simple observation: Stress.

A study from the Max Planck Institute for Cognitive and Brain Sciences and the Technische Universität Dresden found that even being around a stressed person, be it a loved one or a stranger, has the power to make a someone stressed in a physically quantifiable way.

“The fact that we could actually measure this empathic stress in the form of a significant hormone release was astonishing,” said Veronika Engert, one of the study’s authors.

During the study, test subjects paired with loved ones and strangers of the opposite sex and then divided into two groups. One group was given challenging arithmetic questions and interviewed in order to induce direct stress. The group of 211 observers simply watched the test and interviews through a one-way mirror and via video transmissions.

As expected, 95% of the people placed under direct stress showed signs of, well, stress. But 26% of observers had an increase in cortisol as well as a result of empathic stress. The impact of stress was particularly high when a subject was observing a romantic partner in a stressful situation (40%) but it applied to strangers as well (10%).

When observers watched stressful events through a one-way mirror, 30% experienced a stressful response. Another 24% percent of observers were stressed when they watched the events unfold on video. Lesson learned: be careful when you’re watching Breaking Bad re-runs.

Even television programs depicting the suffering of other people can transmit that stress to viewers,” Engert said. “Stress has an enormous contagion potential.”

TIME Social Media

How Facebook Could Sabotage Your Blind Date

Young blonde woman in kitchen preparing food checks laptop
Don Bayley—-Getty Images

Think twice before you cyberstalk—seeing someone online may make face-to-face interactions more stressful

We’ve all been guilty of Facebook stalking – looking up strangers who we might be meeting face-to-face soon – a blind date, a potential employee, or even the friend of a friend. It’s supposed to make us feel a little more comfortable and prepared when the real-life meeting actually takes place.

Or maybe not. Especially if you have mild social anxiety. In a study involving female college students, Shannon Rauch and her colleagues found that surprisingly, a Facebook introduction tended to make some people more nervous during the face-to-face meeting.

MORE: This Is Your Brain on Facebook

Rauch, an assistant professor of psychology at Benedictine University in Arizona, and her colleagues recruited 26 undergraduates and asked them to take a social anxiety test. A week later, the team invited to participants to what they called a facial recognition test – the students were hooked up to a monitor to measure changes in how well the skin in their hands conducted electricity (the more aroused a person is, the better the skin conducts electrical signals) while they looked at either pictures of people or actual people in the testing room. There were four groups: one saw only a person’s Facebook profile page, another saw only a person in the room, another saw a person’s Facebook profile and then saw the person in the room, while the final group saw a person in the room and then perused her Facebook page. For the live encounters, both the participants and the visiting person were told not to interact or talk to one another, which limited the experience to just being in the person’s company.

MORE: The Two Faces of Anxiety

The students who first viewed a person’s Facebook profile and then saw the person in the room showed higher arousal scores than those who simply saw the person, without a prefacing Facebook encounter. That surprised Rauch a bit, since most of the data on digital social interaction suggested the online experience could help to calm the anxiety of meeting someone for the first time in person. “Intuitively we all thought it should help to pave the way a little bit,” she says of her findings, published in the journal Cyberpsychology, Behavior and Social Networking.

MORE: Employers: Facebook Party Pics Don’t Always Reflect Employees’ Bad Judgment

Instead, the Facebook priming made them more aroused. Rauch says the study just measured arousal, and not levels of stress hormones so she can’t say whether the participants were more anxious. It’s possible, for example, that the students were just more excited by the face-to-face encounter, which is a natural response to seeing someone. But Rauch believes that the change was more negative than positive, since it raised arousal, instead of calming it, which is what a more positive effect of the Facebook encounter would have had.

The effect was strongest among those who scored higher on the social anxiety test, which suggests that the real-life encounter was still more arousing than the online one – something that previous studies have shown. Online interactions may feel more safe and comforting to those with social anxiety, since they have more control over the situation.

MORE: How You Deal With Your Emotions Can Influence Your Anxiety

The results go against the idea that online experiences can be a helpful way for some people with social anxiety disorders to gradually get used to real life encounters. “If your goal is to calm yourself for the face-to-face encounter, Facebook is probably not the best strategy,” says Rauch.

Why? The initial online experience could start a process of rumination that leads to expectations and comparisons that the real life encounter may not meet or fulfill. That’s supported by a growing number of studies that show regular Facebook users don’t feel good about themselves, because they are constantly comparing themselves to their peers – on looks, accomplishments and goals.

Rauch hopes the work starts to question conventional wisdom about how social media helps, or even harms, social connections, and plans to study the effect in more detail, by giving participants more choice and control over the real-life interaction, and giving them more opportunity to plan the encounters. “We’d like to start using physiological data to start challenging notions of how social media affects social connections,” she says.

TIME mental health

LSD Therapy Lowers Anxiety, Study Finds

People facing imminent death could benefit from the hallucinogenic

Scientists in Switzerland are testing the anxiety-lowering effects of LSD on people near death, and are reporting promising results.

A new study published in The Journal of Nervous and Mental Disease finds that people who are facing imminent death from cancer can experience positive changes in their anxiety levels from talking to a therapist while under the influence. LSD research has been banned in the U.S. since 1966.

The 12 participants–the majority of whom had terminal cancer–met with lead study author Dr. Peter Gasser for weekly therapy sessions for two months. Eight of the patients received full doses of LSD during their sessions, while the other four received a lesser dose. During their “trips,” which could last up to 10 hours, patients talked about their fears of dying and experienced distressing emotions.

A year after their sessions, researchers found that anxiety levels had improved by 20% on standard measures those for those who got a full dose, and that this lower anxiety level appeared to remain even after therapy. For the participants who took a lower dose of LSD, their anxiety worsened.

With only 12 people, the study is too small to make any significant conclusions. However, it’s part of a bigger movement among psychiatrists to use hallucinogens in therapy for disorders like PTSD and severe anxiety, The New York Times reports. Other researchers are also currently testing the effects of similar drugs on patients’ anxieties.

[The New York Times]

TIME Work & Life

Your Life is Terrible Because You Are a Commuter

At least now you know

Heaven help you if you ride the bus for more than half an hour to work because that, according to a new study out Wednesday, is the worst possible commute you can have.

The study, released Wednesday by the United Kingdom’s Office of National Statistics, finds that “commuters have lower life satisfaction, a lower sense that their daily activities are worthwhile, lower levels of happiness and higher anxiety on average than non-commuters.”

If you don’t ride the bus for more than 30 minutes, don’t be too quick to leap for joy—any commute more than 15 minutes long tends to lower life satisfaction.

And if you’re a health nut don’t be too quick to celebrate you 45-minute, sweat-soaked trail ride into work every day. Though active commuters are in better health, in terms of mental well-being, the results still hold true even for people riding a bike or walking to work if those commutes last longer than 15 minutes.

Then again, the study only included UK residents. Maybe British buses are just that awful.

Your browser, Internet Explorer 8 or below, is out of date. It has known security flaws and may not display all features of this and other websites.

Learn how to update your browser